Breaking ground on new arena in 2015? Needs arena disclosure in 2 weeks

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Breaking ground on new arena in 2015? Needs arena disclosure in 2 weeks

It took Herb Kohl around four months to sell the Milwaukee Bucks.

But it will take a lot longer to get public and private support to build a multipurpose arena for the Bucks and other tenants.

Kohl sold his pride and joy for $550 million on Wednesday and managed to talk Marc Lasry and Wesley Edens into putting up at least $100 million to match the $100 million the former senator plans to contribute toward a new arena.

But Kohl, who has owned the team since 1985 and served four terms in the U.S. Senate, is a realist about what he repeatedly said would be a big hill to climb: persuading taxpayers there has to be some public financing to build a new multipurpose arena that would be expected to cost at least $400 million.

The real work has just begun.

In an interview with the Journal Sentinel, Kohl said it was understood that any talk of new taxes would have to wait until after the November elections.

"Public officials are very concerned about voting on sales taxes or whatever," he said. "Understandably. You have to have a pretty good proposition if you are a public official before you suggest to your constituents that you need support. We have enough time to figure that out, think about what's best."

Kohl said he did not know how much more public and private money might be needed.

"The more money we can bring to the table before we go to the public, obviously, the better it will be."

Kohl made it clear that without a new arena, the Bucks would be gone. And, he said, millions of dollars in potential downtown development would go away, too.

"Ultimately, if we don't get to a new arena, yes, we will lose our team," Kohl said. "The money will go away."

The NBA has imposed a 2017 deadline to have an arena in place or have one under construction. But a Bucks official said Wednesday no new extension has been granted.

Challenges ahead

Timothy Sheehy, president of the Metropolitan Milwaukee Association of Commerce, said the challenge of getting public financing was a given.

"There's no question at some point we will need public financing. This makes that 'ask,' as the senator put it, more reasonable," Sheehy said. "There is more private-sector money coming."

So far, public opposition to any form of taxation to finance and build a new arena has been strong. County boards in Ozaukee, Racine and Waukesha counties are on record in opposition to any kind of regional tax to fund a new arena or expanded convention center.

Edens said his goal would be to plan, design and fund an arena over the next year or so. "And then build it over a couple of years," he said.

"We've had a lot of experience with real estate and infrastructure projects," Edens said.

Gov. Scott Walker said Edens and Lasry had not made any specific requests of his administration.

"They have asked to have, at some point in the future, a meeting with me and some other members of the Legislature to talk about some of their ideas as to what may or may not be the public role if there is one. But it's pretty premature at this point," Walker said.

The governor also said he had some ideas about potential locations for a new stadium.

"I remember in the past looking a lot at the Park East corridor," he said. "It's an important part not only of Milwaukee's economy, but the economy of the whole. We saw years ago in the area near Miller Park and the positive impact it's had on the area of Blue Mound Road, the corridor there and the establishments there."

Kohl said he would not be the decision-maker for an arena site.

"Likely, if it doesn't get built, it doesn't need competitors," Kohl said. "So it would not augur well for the BMO Harris Bradley Center and the U.S. Cellular Arena to be in competition. I'm not the decision-maker. I'm just speculating."

If these people are opposed to public financing, then I vote there be NO taxes on anything associated with the Milwaukee Bucks, from tickets to sportswear to food at/around arena to anything else related. Seems pretty fair to me ? Sick of uneducated people not considering all angles when these stadium projects come up across the country.

And I'm not one of the mindset that government needs to pay for everything...I just can see that the state would in fact make money off of the business just like the Bucks themselves would.

Seated at a table on the Milwaukee Bucks’ home court, Peter Zehren looked around the Bradley Center on Thursday and acknowledged that the facilities look out of date. But the Milwaukee resident was firm when he said taxpayers shouldn’t have to pay for an upgrade.

“It’s a travesty to average citizens who deserve a better environment and safer streets,” said Zehren, 53, who runs a nonprofit consulting firm. “Let them tax people when they go to events here.”

Zehren was attending a Milwaukee Press Club event at the Bradley Center, where three local political and business leaders took questions from reporters about the debate over a new stadium.

The speakers acknowledged that a local tax wouldn’t be popular with residents such as Zehren, but they said the option should be one of several on the table.

The Press Club event was planned weeks ago, well before Bucks owner Herb Kohl announced Wednesday that he is selling the team to Marc Lasry and Wesley Edens for $550 million. The two New York executives committed to providing $100 million to help build a new arena, and Kohl said he’d donate another $100 million.

However, a new stadium could cost $400 million or more. If private investors don’t pick up the other half of the tab, taxpayers might be asked to cover the remainder.

The situation means tough decisions will have be made, said Milwaukee Alderman Michael Murphy, one of the panelists.

He said it’d be tough to persuade Milwaukee residents that scarce tax dollars should go toward building a new arena where there’s not enough money for pressing social issues. One answer might be a sales tax, imposed not only on Milwaukee County residents but also on people who live in adjoining counties, he said.

Ozaukee, Racine and Waukesha counties already have said they oppose any new regional taxes to build arenas. But Murphy said the cost shouldn’t fall only on Milwaukee, which struggles with deeper poverty-related problems than the other counties do.

“We might have to go with the higher moral ground argument” with the other counties, Murphy said. “If you want to see the region do well, you’ll have to help. It makes no sense for the region to let the city of Milwaukee die.”

Marc Marotta, the chairman of the Bradley Center board of directors, said the building is too small by NBA standards. For example, it can seat 7,500 fans in the lower bowl, but other NBA arenas seat an average of 10,000, he said.

Even if a new facility is not built, maintaining the current building would cost $100 million over the next 10 to 12 years, he said. That sum would end up being a public obligation anyway, he added.

“That’s a challenge we face and that’s a challenge the community faces,” he said.

The next steps are likely to include efforts to attract as much funding as possible from private investors

Right off the bat, it's obvious that many of the cheapest NBA arenas to construct are also the oldest. Since 1996, Oracle Arena has poured more than $300 million into arena renovations; more than any other NBA arena thus far. After the 2012 season, the New York Knicks will have completed a $850 million renovation to Madison Square Garden. The MSG renovations is the main culprit for rising ticket prices to Rangers and Knicks games.

The Bradley Center is considered perhaps the most outdated NBA arena of the thirty. It lacks club seating, has poor parking in the surrounding areas and extremely small concourses. There have been recent proposals by the city to construct a new NBA arena but nothing has been finalized.

The Barclays Center, future home of the Brooklyn Nets will be featured in a $4+ Billion dollar project that will include an NBA arena, residential and retail space. Whether or not the NHL's Islanders will share the Barclays Center with the Nets has yet to be determined. The arena has been projected to only be able to occupy less than 15,000 at capacity for ice hockey. The venue sold it's naming rights to Barclays plc out of London, England.

Nine of the thirty NBA arenas are also home to NHL franchises. The Staples Center is the only arena to host three professional franchises; the Kings, Lakers and Clippers.

Power Balance Pavilion will possibly be the first NBA arena on this list to be demolished in coming years. The Sacramento Kings recently reached a deal with the city to erect a new arena in the downtown district. The current site is located in the Sacramento suburb of Natomas. In case you didn't notice, the Indiana Pacers no longer play in Conseco Fieldhouse; Bankers Life and Casualty recently purchased the naming rights to the Fieldhouse.

Thanks in no small part to Herb Kohl's unwavering belief that the Bucks belong in Milwaukee, the city and the surrounding area now has a unique opportunity to weigh a combined $200 million pledge from Kohl and new (prospective) owners Marc Lasry and Wesley Edens and decide what it will take to make sure the Bucks remain a cultural pillar of the local scene. We here at Brew Hoop obviously love the Bucks and value their presence in Milwaukee more than the average person, so obviously we are focused on finding a reasonable solution that benefits all parties and keeps the team rooted in Wisconsin.

Developing a public-private partnership to build a cultural asset like a multi-purpose downtown arena will no doubt require broad buy-in for a bold vision and creative non-partisan problem solving efforts from local leaders. Unfortunately, this topic can too easily devolve into a binary political debate where complex issues get reduced to talking points and toxic buzz words. Our hope is that stakeholders never lose focus of the big picture and find a way to address financing in a logical fashion.

If the first step is to secure the largest investments from private business that will benefit the most from a new arena, the good news is that Kohl has pledged a $100 million gift and Lasry/Edens are prepared to commit at least $100 million as well. Additionally, more local investors are expected to buy in to the franchise, which along with arena naming rights and other sponsorship deals suggest an infusion of additional money should be on the way from other private entities.

If the second step is to raise money from the people who will use the facility and derive the most benefit from the project, we hope that all options stay on the table, including ticket taxes (yes, ticket prices will go up and none of us are allowed to complain, okay?), hotel taxes, "sin" taxes, TIFs, etc. From there, it will come down to finding the most effective ways to bridge the gaps and generate community support. Hopefully the ball can get rolling on this front as soon as NBA owners formally approve the sale of the Bucks, and groups like Common Ground can search for a happy compromise with a reasonable level of money put toward ancillary local improvements.

Given the modest size of the Milwaukee media market, public money will almost certainly be needed, so the goal should be to identify the key needs of stakeholders and use every funding mechanism in tool box to strike the right balance and get a deal done. Not that the status quo is cheap either: the Bradley Center will cost an estimated $100 million to keep running over the next decade, so it's possible that the state gets stuck with a hefty arena bill even without a new arena. This is ultimately a high-stakes negotiation with the fate of the Bucks and the future direction of Milwaukee hanging in the balance, so things may get ugly before a solution emerges. We will do our best to help the discourse rise above petty politics and myopic debates to at least pose the question of what type of city Milwaukee wants to be and how an arena could perhaps become the centerpiece of a broader revitalization plan downtown.

A bold vision for building a better Milwaukee and enhancing the cultural profile of the city needs to emerge for any proposed arena project to succeed, and we feel hopeful about local leadership finding solutions that keep the Bucks in Milwaukee. Check out our podcast on the arena issue and let us know what you think in the comments section.

The recent sale of the Milwaukee Bucks will not alter a grassroots effort to persuade public officials that if taxpayer money is used to pay for a new arena, it should also pay to improve courts and ball fields at area schools.

Longtime owner and former U.S. Senator Herb Kohl announced on April 17 that he sold the NBA team to investors Wesley Edens and Marc Lasry for $550 million. The three pledged to chip in at least $200 million for a new arena, which is expected to cost at least $400 million, meaning the public may need to foot the rest of the bill.

Officials and volunteers of Common Ground’s Fair Play campaign voted earlier this month to support public funding for a new Bucks arena if a $150- to $250- million public investment is made to improve Milwaukee County public school outdoor athletic and recreational facilities, and to oppose the project if public money for these facilities is not included.

“As we have consistently stated, Common Ground is not opposed to a new arena. But if public taxpayer money is used to build a new Bucks Arena, we demand a say in how our money is used, and that means investing in our children through Fair Play. New ownership does not change that,” said Jennifer O’Hear, the chairwoman of the campaign, in a statement.

Common Ground, a grassroots organization of citizens, small businesses and churches that focuses on social and economic issues, launched the Fair Play campaign last April to make the public funding pitch.

In June, Fair Play released a report showing two-thirds of the outdoor athletic and recreational facilities at 268 public schools in the county’s 38 school districts are in terrible, poor or fair condition. The Milwaukee Public Schools was one of 11 districts with facilities rated in the poorest condition, according to the report.

“We welcome Mr. Edens and Mr. Lasry to Wisconsin. If they want public money for their new Bucks arena then we hope they will support public money for the athletic facilities (used by) our children. It’s Fair Play,” O’Hear said.

The Milwaukee Bucks had the NBA’s worst record during the 2013-14 season, winning just 10 out of 41 games at home. The team, which plays at the BMO Harris Bradley Center, also recorded the worst attendance in the league during the season.

The Metropolitan Milwaukee Association of Commerce created a task force in October to explore financing and enhancements for the metro area’s cultural and entertainment facilities, including the Bradley Center, which also hosts concerts, college basketball games, NCAA tournaments and Admirals hockey.

The arena, for which the Bucks have a lease until 2017, is owned by the public and receives tax support for its operations. The arena will need at least $100 million in investment to stay operational, according to MMAC President Tim Sheehy.

“The bottom line is that a new facility is a necessity to move forward with the NBA. Done right, it can be a game-changing development for the Milwaukee region but will need some level of public sector investment,” Sheehy said in a blog after the sale of the team.

The Milwaukee Bucks describe the training facility they’ve used since 1997 at the Archbishop Cousins Center as first-class, but the team’s new owners may seek an upgrade.

The Bucks' facility at 3501 S. Lake Drive in St. Francis includes the basketball operations offices as well as training facilities, a running track and a basketball court.

In the summer of 2006, the facility received a major makeover that coincided with the team’s new logo and colors. The project included a new practice court.

In spite of those improvements, new Bucks co-owner Wesley Edens told me that he and co-owner Marc Lasry will look into the possibility of better quarters. I asked Edens about his perspective on the practice facility when I interviewed him Tuesday night about the NBA draft lottery, in which the Bucks won the second pick.

“You want to have a culture of having the best facilities and the best environment for the team,” Edens said. “I think that the physical plant matters a great deal. That’s why we’re excited about a new arena.

“The practice facility seems perfectly fine but it's probably fair to say it’s not the best practice facility in the league. At the end of the day, we want everything to be first class.”

Edens said upgrading the practice facility is not nearly as high a priority as building a new home arena for the Bucks.

“It’s hard to know exactly what the priorities will be, but it’s certainly on the list,” he said.

The Cousins Center is owned by De Sales Prepatory Seminary Inc. The Bucks facility is tucked in the back of the property but the entry off Lake Drive offers a picturesque view of Lake Michigan and the Milwaukee shoreline.

Actually the practice facility probably be out of new owners pockets only. Yeah the new arena might tax the public. Brewers stadium tax should be expired by now? They still taxing people for the hell of it? Flip that tax over to the Bucks.

New Milwaukee Bucks co-owner Wesley Edens is making another investment in Milwaukee — albeit indirectly — with Thursday’s news that Brookdale Senior Living Inc. plans to spend $3.9 million expanding its West Allis offices and hire more than 200 new employees.

Edens was a co-founder of Brookdale Senior Living in 2005 when the company was created to combine two leading senior-living companies: Brookdale Living Communities Inc. of Chicago and Alterra Healthcare Corp. of West Allis. Brookdale Senior Living, which is based in Nashville, has grown into the largest publicly traded senior living operator in the United States through organic growth and acquisitions.

Edens, 52, remains on Brookdale’s board of directors after stepping down as chairman in June 2012. The company he now co-chairs, Fortress Investment Group, of New York City, owns about 15 percent of Brookdale’s stock. He receives no compensation for his role on the Brookdale board.

Brookdale’s West Allis office is at 6767 W. Washington St.

It’s just a coincidence that Brookdale is planning to invest in metro Milwaukee in the same period that Edens and Lasry are co-investing $550 million in the Milwaukee Bucks. Edens and Lasry also have pledged $100 million toward a new arena that would be built in downtown Milwaukee.

“It is a coincidence and this is something that has been in the works for some time,” Walker’s press secretary Laurel Patrick told me.

Brookdale will receive up to $1 million in Wisconsin Economic Development Corp. tax credits if it hits the goal of hiring 202 workers for its information technology, finance and asset management operations.

Milwaukee Brewers lead owner Mark Attanasio declined to comment on whether he would buy the Milwaukee Bucks, but he said he would be willing to financially "help out" with paying for a new arena in downtown Milwaukee.

Attanasio said he is familiar with efforts of Milwaukee investment and real estate executive Ted Kellner, who is chairman of the Metropolitan Milwaukee Association of Commerce, to win support for a new arena to house the Milwaukee Bucks and other sports and entertainment events.

"There's a Ted Kellner group at the MMAC looking to support things, so we'd figure out whatever way was smart to do that," Attanasio told me. "But I wouldn't rule out financial support."

I spoke with Attanasio after his annual Opening Day press conference at Miller Park before the Milwaukee Brewers took on the Atlanta Braves.

Attanasio told me he is willing to support Bucks owner Herb Kohl's quest to win support for a new arena. Kohl has said he will contribute a significant amount of his own money for such a project.

"I'm interested in what Senator Kohl's trying to achieve in terms of building an arena in the community," Attanasio told me. "The community needs an arena at some point - not just for the Bucks but for the vibrancy of the community."

Attanasio told me he would "definitely help out with a new arena."

Then I asked him to respond to persistent rumors that he could buy or invest in the Bucks, as Kohl seeks the next generation owner of the team. Attanasio, a prosperous Los Angeles-based investment executive, led a group that bought the Brewers in 2005.

So has Attanasio spoken with Kohl's representatives who are fielding inquiries about investing in the Bucks?

"I'm not allowed to talk about what I talk about or don't talk about," Attanasio told me. "I make a policy of it. I don't talk about conversations that I have with third parties or not. If I did or I didn't, I wouldn't tell you."

Isn't attanasio some sort of investor/owner of the admirals? If that's the case, it would make sense that he would have an interest in a state of the art facility. People loved coming to miller park just to see the stadium and roof, so it would make sense that those who can't afford or don't want to pay the price of bucks tickets would be interested in admirals games to check the facilty out.

That being said, does anyone know the terms for Marquette to play in the Bradley center? Do they rent it like the bucks? In the case of a new arena, would they be obliged to put money forward? Everyone seems to be hellbent on the bucks paying for the arena, why isn't their some groundswell for Marquette to put some skin in the game?

A private university of marquettes stature should have plenty of wealthy private donors, can't they raise at least $50 million dollars to add to the $200 million pledged by the owners and herb?

I believe Marquette leases the Bradley center as well. They either have to chip in or build their own facility on campus. Cause once new arena is built i'm sure BMO Radley Center is bull dozed.

Well Kohl chipped in $100M wish both new owners would of chipped in $100M each. Maybe still will when it goes down to the wire. The naming rights of the building for 20 to 30 years has to be worth at least $30M to $40M easy or more. Each gate can be named as well for less like $5M per.

Plus if they build it big enough for yearly food places like restaurants and fast food and night clubs and sports shops and whatever else. So Marquette and Admirals should chip in as well. That way they get their own private locker rooms or team hall of fame? They chip in they probably get a little say in things.

That's $410M if our new owners throws in that extra $100M over the other $100M they started out. Maybe Marquette or Admirals chip in more then $25M each I suggested? Cause if Marquette decides to build on campus that's easily $100M or more. Or get other investment groups like Aaron Rodgers or Junior Bridgeman or Menards or Attanasio. Bridgman owns a bunch of Wendy's fast food chains. He could either name the arena Wendy's or have a Wendy's in it. Maybe Pabst or Miller chips in?

Getting the extra $100 million from the owners is probably wishful thinking. They've already paid what is theoretically above market value for the team. Maybe if it comes down to the wire they'll do it, but I don't see that announcement happening any time soon.

I think a tax is probably going to need to be part of it, but I think it will be very, very difficult to pass it. If I'm not mistaken, the Miller Park tax is still in effect. But I don't think they can just flip that over to a new Bucks stadium. I think they'd need a referendum for that.

I've heard that guys like Bridgeman and others getting involved, but I guess I'm confused by how that would work. No one is going to just throw their money at the stadium for no reason. My guess would be that the new owners would have to sell minority shares of the team to raise the extra funds, but I wouldn't know how else they would get any return on their investment.